By BJ Austin
Dallas, TX – Reunion Arena in downtown Dallas sits dark, waiting for the wrecking ball. What happens next to that valuable piece of property could sound like an episode of the television show Dallas a world where a rich oilman called the shots. KERA's BJ Austin says a 30 year old land-swap deal could put Reunion's prime real estate in the hands of a modern-day billionaire.
The front doors of Reunion Arena are locked, and a security guard keeps watch behind the darkened glass. By next spring, the 18 thousand-seat arena that was home to the Dallas Mavericks and Stars will be gone leaving only memories of a Stanley Cup win and sold-out concerts by Pink Floyd, Garth Brooks and Sir Paul McCartney, among others.
What ultimately happens to the 8 valuable acres on the very doorstep of the future Trinity River Park will be up to City Hall and Dallas billionaire oilman and developer Ray Hunt. He's part of the decision because of a 1974 deal. The city and Hunt swapped pieces of property allowing the city to build Reunion Arena, and Hunt to build the Hyatt Hotel next door.
Standing in the shade of the arena on a hot afternoon, Dallas real estate consultant Marcus Wood believes the property will only increase in value as the Trinity River Park is developed and plans for a nearby Convention Center hotel proceed.
BJ Austin: As we look at Reunion Arena, what do you see as the future of this property?
Wood: Time is going to be a major factor. And who knows what the economy, and particularly the fuel and mass transit, and just those demands are going to be. This could play major roles, and we could see this whole thing become very, very, very valuable as compared to where it is today.
The city could sell the property, develop it, or lease it for development. The 1974 agreement appears to give Ray Hunt first dibs on leasing it, and he also has the right of first refusal to buy the property if the city declares it surplus - in other words, unneeded or unwanted property. And, the agreement includes a complex formula to arrive at the purchase price for the Reunion Tract. No one at City Hall is willing to put a dollar figure to that. But, the Dallas County Appraisal District puts the property's market value at more than 24 million dollars.
Hunt: I have concerns about the Master Agreement. I have serious concerns about it.
Dallas Council member Angela Hunt - no relation to Ray Hunt -- has requested a comprehensive closed door council session with the City Attorney to go over the agreement, and study the city's options.
Hunt: You know what I'd really like to see us do, especially in this market, is hold onto the property. It's close to the future convention center hotel. It is one of the closest pieces of property to the Trinity River Park. I think we have a real opportunity over the next ten to 15 years to see that property become a terrific development. I do have concerns that sometimes we get dollar signs in our eyes and we think let's sell now and worry about the consequences later. We really need to be smarter than that.
During a break at a City Plan Commission meeting, land-use consultant Willie Cothrum - a Dallas City Council member in 1974 -- acknowledges years of grumbling about the deal with Ray Hunt.
Cothrum: Was it generous? You know generous is a subjective term. To those of us back when we were doing the deal, it looked like a very good deal to us to make something happen. That part of town down there had been just sitting dormant. The city found a partner who was willing to take an area that nobody else had done anything with. It was an acceptable deal.
Ray Hunt has, on occasion, has referred to the so-called Master Agreement to assert his influence over what happens to the Reunion property. In 2005, he used it as a platform for his opposition to a possible casino on the property -- saying that would not meet the land use requirements. Assistant City Manager Ramon Miguez says Hunt, and his Woodbine Development Corporation, DO have a say about what happens to the property, but Hunt does not have veto power.
Miguez: There is something in the Agreement that allows Woodbine to at least opine on how that property might be used.
Hunt, for example, might object to a project that would compete with his Hyatt Hotel, or Union Station events next door -- which he controls per the 1974 agreement.
At City Hall: Councilmember Mitchell Rasansky - a real estate investor -- says the agreement with Hunt will not present a major obstacle whatever the city decides.
Ransasky: I've looked over that. The right of first refusal, I've looked over that - we're in the driver's seat with that.
John Scovell, President of Ray Hunt's Woodbine Development, says it would be premature to speculate on how the tract might be developed - who would own it, and who would build on it - until the city decides whether to sell.
Real Estate Consultant Marcus Wood says Reunion - one of the most valuable tracts in downtown Dallas, can only increase in value: which makes the decision about ownership so important.
Wood: Well, that's the 64 million dollar question.
This fall, the Dallas City Council is expected to begin closed door discussions about what to do with the Reunion property.